A sign hangs on the front of an Olive Garden restaurant on June 22, 2023 in Chicago, Illinois.
Scott Olsen | Getty Images
Darden Restaurants on Thursday reported quarterly earnings and sales that met analysts' expectations and better-than-expected same-store sales growth at Olive Garden and LongHorn Steakhouse.
The company's shares rose 8% in premarket trading.
Here's what the company reported compared to Wall Street's expectations, based on an LSEG analyst survey:
- Earnings per share: $2.03 adjusted vs. $2.02 expected
- Revenue: $2.89 billion versus expected $2.9 billion
Darden reported second-quarter net income of $215.1 million, or $1.82 per share, up from $212.1 million, or $1.76 per share, a year earlier.
Excluding costs related to the Chuy's acquisition, the restaurant company earned $2.03 per share.
Net sales rose 6% to $2.89 billion.
Darden's same-store sales rose 2.4%, beating StreetAccount estimates of 1.5%.
LongHorn Steakhouse reported same-store sales growth of 7.5%. The casual dining chain has been one of the top performers in Darden's portfolio in recent years, impressing customers with both the quality of its food and its prices. Wall Street expected the chain to report same-store sales growth of 4.1%.
Olive Garden, which accounts for more than 40% of Darden's quarterly sales, posted same-store sales growth of 2% in the quarter. Analysts expected same-store sales growth of 1.4%, according to StreetAccount.
Darden's fine-dining segment, which includes The Capital Grille and Ruth's Chris Steak House, posted a 5.8% decline in same-store sales, worse than the 2.8% decline analysts expected. Deli chains' higher prices have deterred many consumers trying to spend less at restaurants.
The company's final remaining segment, which includes Cheddar's Scratch Kitchen and Yard House, posted same-store sales growth of 0.7%, in line with estimates.
Darden added a net 39 new locations and 103 Chuy's restaurants during the quarter. Darden completed its $605 million acquisition of the Tex-Mex chain in October.
The company updated its fiscal 2025 outlook to include Chuy's results, although the chain will not be included in its same-store sales metrics until the fourth quarter of fiscal 2026. The company now expects total revenue of $12.1 billion, up from its previous estimate of $11.8 billion to $11.9 billion. Darden reiterated its guidance for net income per share from continuing operations of $9.40 to $9.60.
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